News Release

Vancouver – A Vancouver investment dealer has reached a settlement with the British Columbia Securities Commission for acting contrary to the public interest over its role in a financing deal for an Internet equipment and services firm.

Vancouver-based Wolverton Securities Ltd. must pay $60,000 to the BCSC in connection with its conduct as the agent in a planned public offering of 1.5-million Cinema Internet Networks Inc. shares in 2000.

In the settlement, Brent Wolverton, president of Wolverton Securities, admitted that he failed to properly supervise his employees to ensure compliance with securities laws and exchange regulatory requirements in connection with the Cinema financing deal.

Timothy Fernback, who was manager of corporate finance at Wolverton Securities, and William Massey, president and a director of Cinema, admitted that they ought to have known that certain trading in Cinema shares could create an artificial price for the company’s shares.

Cinema, listed at that time on the Canadian Venture Exchange (now the TSX Venture Exchange), planned a public offering of 1.5-million shares with Wolverton Securities as its agent. On Feb. 11, 2000, the company’s shares traded as high as $1.25 a share before Wolverton Securities sold 87,400 Cinema shares owned by a Cinema employee. That day, Cinema’s shares closed trading at $0.32 a share.

On Feb. 14, 2000, after selling the employee’s shares, Cinema issued a news release prior to the opening of the market announcing an offering of 1,350,000 shares at $0.30 per share.  The $0.30 per share price was based on the previous trading day’s closing price of $0.32. The exchange did not approve that price but eventually approved an offering priced at $0.675 per unit, with each unit consisting of one common share of Cinema and one-half of one share purchase warrant.

In addition to Wolverton Securities paying $60,000, as part of the settlement, Massey has agreed to pay $5,000 to the BCSC, Fernback will pay $20,000, and Wolverton will pay $30,000. All three payments include investigation costs.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the settlement on our website www.bcsc.bc.ca by typing in the search box the names above or 2005 BCSECCOM 304. If you have questions, contact Andrew Poon, Media Relations, 604-899-6880.